Huatai Securities: Under the new standard for electric meters, the industry is expected to achieve both volume and price growth by 2026

Huatai Securities Research Report states that on February 6, the State Grid’s 2026 marketing project measurement equipment special (the third batch of electricity meter bidding for 2025) was publicly tendered, with a clear price limit. The prices generally increased by over 20% compared to the second batch of 2025, marking a rebound after a decline. Under the new standard for electricity meters, the industry is expected to achieve both volume and price growth in 2026, driving a recovery in corporate profitability. Leading companies with technological advantages are likely to gain higher market shares in the early stages of implementing the new standards.

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Huatai | Power & New Energy: Price Rebound in New Standard Electricity Meter Re-bidding

Key Points

On February 6, the State Grid’s 2026 marketing project measurement equipment special (the third batch of electricity meter bidding for 2025) was publicly tendered, with a clear price cap. Prices increased by over 20% compared to the second batch of 2025, marking a rebound after a decline. We are optimistic that under the new standard for electricity meters, the industry in 2026 will see both volume and price growth, supporting a recovery in corporate profitability. Leading companies with technological advantages are expected to secure higher market shares early in the rollout of the new standards.

Prices for new standard electricity meters have stopped falling and are rebounding. The expected winning bid prices in the re-bidding batch could increase by over 20%.

The third batch of electricity meters in 2025 was the first to fully adopt the new standards. However, due to generally high bids from companies, the final bids resulted in a bid failure. The opening prices for A/B/C/D-grade and high-end smart meters were 213/505/428/611/3579 yuan, respectively, with increases of 55%/46%/37%/111%/53% compared to the second batch of 2025. This re-bidding set clear price limits for different parameter standards: typical price caps for A/B/C/D-grade and high-end smart meters are 170/435/380/570/3900 yuan. These caps represent a general increase of over 20% compared to the second batch of 2025, marking a rebound after a decline.

Changes in price scoring standards may lead to continued price competition trends.

This re-bidding altered some of the scoring criteria for electricity meters. The bid price range used for baseline price calculation was adjusted from [-10%, +5%] in the previous bid to [-15%, +5%] in the second batch of 2025, meaning that overly low bids could have a greater impact on the effective average price, potentially lowering it. The floating coefficient C range was adjusted from -0.5%~0.5% to -1%~0.25%, increasing the likelihood of negative coefficients. The penalty for bids exceeding the baseline price by 1% increased from 1 point to 1.5 points, while bids below by 1% decreased from 0.3 points to 0.1 points. As a result, the score difference between bids 1% above and below the baseline widened from 0.7 to 1.4 points. Overall, owners remain focused on procurement prices, and price competition among manufacturers may continue.

The launch of the new standard combined with re-bidding demand suggests overall demand in 2026 could remain high.

Reviewing the first to third batches of measurement equipment bidding in 2025, a total of 66.47 million electricity meters (including A/B/C/D-grade and high-end smart meters) were tendered. The third batch, with 16.96 million meters, failed to bid, and the actual tendered volume for the year was 49.52 million, which is relatively low (based on an 8-10 year replacement cycle for electricity meters, corresponding to high demand in 2015). We believe: 1) as standardized products, actual bidding volume in 2025 was low, so there is strong replenishment demand in 2026; 2) historically, after new standards are introduced, the first batch often involves small trial bids, but annual demand tends to grow rapidly with the new standard rollout. Therefore, we expect overall demand in 2026 to remain high.

We are optimistic that under the new standard for electricity meters, the industry can achieve both volume and price growth.

We forecast that prices in this batch of new standard electricity meter re-bidding could increase by over 20% compared to the second batch of 2025. With the new standard meters beginning large-scale bidding, overall demand in 2026 may stay high. Leading companies with technological advantages are likely to gain higher market shares early in the implementation of the new standards.

Risk factors: Lower-than-expected grid investments, intensified industry competition.

(Source: People’s Financial News)